Supreme Court's New "Functional Equivalent" Standard Means Regulatory Uncertainty Under an Expanded Clean Water Act

May 04, 2020

The Clean Water Act (CWA) forbids the addition of any pollutant from any point source to the waters of the United States (including navigable streams, rivers, the ocean, or coastal waters) without the applicable permits from the Environmental Protection Agency (EPA). In County of Maui v. Hawai’i Wildlife Fund, the question at issue was whether the CWA’s jurisdiction is triggered by point source discharges into groundwater when that discharged material ultimately reaches the waters of the United States through natural connections between groundwater and surface water. 1 On April 23, in a 6-3 ruling, the U.S. Supreme Court held that the National Pollutant Discharge Elimination System (NPDES) permitting regime under Section 402 of the CWA is triggered by both direct discharges into waters of the United States and when there is the “functional equivalent of a direct discharge.”

Factual Background

In Maui, the controversy stemmed from unpermitted discharges into underground injection wells. That discharged waste would then migrate via groundwater into the Pacific Ocean. The County of Maui’s wastewater reclamation facility collected and partially treated sewage before disposing the waste into injection wells more than 200 feet below ground level. Four million gallons per day of this effluent would travel a half-mile through groundwater before being discharged into the Pacific Ocean.

In 2012, several environmental groups brought a citizens’ CWA lawsuit against the County of Maui, claiming that it was discharging a pollutant into navigable waters without the required NPDES permit. The County argued that the permitting requirements only apply when there are direct discharges of pollutants from point sources into navigable waters.

The District Court granted summary judgment in favor of the environmental groups holding that the discharge into groundwater was “functionally one into navigable water.”2 It further explained that the discharged effluent migrated through a “clearly ascertainable” pathway between the injection wells and the ocean. The Ninth Circuit affirmed, but expanded the scope of the standard, noting that a permit is required when “the pollutants are fairly traceable from the point source to a navigable water such that the discharge is the functional equivalent of a discharge into the navigable water.”3

The Supreme Court granted certiorari in light of the different standards adopted by various Courts of Appeals. While the Ninth Circuit invoked the “fairly traceable” standard to determine whether NPDES permits are required, the Fourth Circuit’s standard required a “direct hydrological connection.”4 Even further, the Sixth Circuit held that discharges through groundwater are expressly excluded from the CWA’s permitting requirements.5

“Functional Equivalent” Standard and the Court’s Legal Reasoning

“Virtually all water, polluted or not, eventually makes its way to navigable water. This is just as true for groundwater.” The Court recognized that the “power of modern science,” at least under the Ninth Circuit’s “fairly traceable” standard, could result in the EPA asserting its NPDES permitting authority over the discharge of pollutants that only reaches navigable waters in highly diluted forms after many years. Instead, in drafting the Court’s opinion, Justice Stephen Breyer focused on the legislative purpose of the CWA. 

Justice Breyer explained that Congress’ primary aim with the CWA was to “provide federal regulation of identifiable sources of pollutants without undermining the States’ longstanding regulatory authority over land and groundwater.”

The Court highlighted the difficulty with applying the “functional equivalent” standard, acknowledging that they would not use more specific language because there were too many potentially relevant factors applicable to factually different cases. For guidance, the Court provided the following list of factors that could be relevant to determining whether there is the “functional equivalent of a direct discharge”:

  • Transit time
  • Distance traveled
  • Nature of the material through which the pollutant travels
  • Extent to which the pollutant is diluted or chemically changed as it travels
  • Amount of pollutant entering the navigable waters relative to the amount of the pollutant that leaves the point source
  • Manner by or area in which the pollutant enters the navigable waters
  • Degree to which the pollution (at that point) has maintained its specific identity

The Court predicted that time and distance would be the most important factors in most cases. Despite the potential for unpredictability with regards to what circumstances now require permits, however, the Court noted that lower courts would provide guidance through decisions in individual cases. Also, the EPA and underlying statutory objectives would provide additional guidance.

Justice Clarence Thomas’ dissent, joined by Justice Neil Gorsuch, reasoned that a permit should only be required “when a point source discharges pollutants directly into navigable waters.” His dissent criticized the majority’s “functional equivalent” standard for departing from the statutory text and relying on an “open-ended inquiry into congressional intent.” Justice Thomas further argued that including the term “addition” in the CWA should exclude anything other than direct discharges from permitting requirements. He further disapproved of the majority’s nonexhaustive seven-factor test: “like most multifactor tests—it leaves courts adrift once those facts have been identified.”

Justice Samuel Alito’s dissent was even harsher regarding the “functional equivalent” standard. He argued that the majority’s opinion provides no clear guidance, invites inconsistent application, and should have “adopt[ed] rules that can be applied with a modicum of consistency.” According to Justice Alito, it would be anybody’s guess how the permitting regime derived from the majority’s test would apply to “middle instances.” On the contrary, his interpretation of the statute focused on whether there is a “point source,” suggesting that a permit should be required when a “pollutant is discharged directly from a point source to navigable waters.”

CWA Permitting Implications

The Court’s “functional equivalent” standard, at least from the perspective of multi-jurisdictional actors, provides a measure of certainty by clarifying the prior split among circuit courts and establishing a set of factors that could be relevant. On a case-by-case basis, however, the various factors will surely make it more difficult to predict which circumstances will require permitting. With respect to the substantial burden required to obtain NPDES permits and substantial penalties for failing to obtain required permits, this new standard’s lack of predictability will have consequences for industries moving forward.

Adding a measure of uncertainty, the EPA expressly excluded groundwater from its final “Waters of the United States” rule that it recently published on April 21, noting that “groundwater or subsurface connection[s] could also be confusing and difficult to implement, including in the determination of whether a subsurface connection exists and to what extent.”6

Opponents of the “functional equivalent” standard argue that it would vastly expand the scope of the statute. The County of Maui reasoned that this new standard could potentially require permits for each of the 650,000 wastewater reclamation facilities across the United States or for each of the over 20 million septic systems used in residential homes.

More industries beyond municipal utilities will likely be implicated by the new standard. Depending on the circumstances, the “functional equivalent” standard could require permitting obligations for activities related to the construction of pipelines, injection wells associated with oil and gas production, chemical and industrial manufacturing, and even agricultural production, among many others.

Kinder Morgan’s amicus brief describes the substantial burden for industry with the expansion of the CWA:

Given the enormous costs of compliance and sizable penalties for noncompliance, there must be a clear line that will enable potentially regulated entities to determine in advance whether a NPDES permit is required—not an utterly unpredictable standard that will force them to choose between obtaining a costly permit they should not need and risking massive fines for discharges the CWA was not meant to cover.7

Even the nation’s food production could be implicated by the new “functional equivalent” standard as “[m]illions of agricultural enterprises could be newly subject to the CWA’s permitting requirements.”8 For instance, ordinary agricultural operations such as fertilizer application, pesticide application, and waste management practices associated with livestock feeding operations could result in material entering groundwater through rain or irrigation runoff or eventual seepage into the soil.9 As such, the agriculture industry acknowledges that few farmers and ranchers could afford the possible hundreds of thousands of dollars and years of waiting that it may take to obtain a NPDES permit.10

Opponents to the new standard also suggest that expanding the definition of a CWA violation to encompass all pollutants that eventually reach into navigable waters would also distort other aspects of the statutory scheme and existing regulations that protect groundwater.

Although “point source” was not at issue in Maui, given that the County’s injection wells clearly constituted a “point source” under the CWA, it is possible that environmental groups could seek to broaden the meaning of “point source” based on the Court’s recognition of the connectivity between surface water and groundwater. In light of Maui, there could be further implications if parties seek to broaden the term “point source” to include, for example, historic spills from a tank or a degreaser to the ground as point sources when the plume created by the spills travels through groundwater to a navigable water.

From an environmental perspective, it cannot be understated that this decision confirms that the hydraulic connection between surface water and groundwater can trigger jurisdiction under the CWA. Environmental advocates call the decision a “huge victory for clean water.”11 Moreover, aquatic scientists explained that the “scientific reality” of connections between point sources and surface waters through groundwater must be accounted for to effectuate the CWA’s purpose of restoring and maintaining the integrity of the nation’s waters.12


The Supreme Court’s “functional equivalent of a direct discharge” standard in County of Maui v. Hawai’i Wildlife Fund relies on case-by-case analyses embracing various factors. The Rapanos v. United States decision and its “significant nexus” test led to a decade of CWA litigation surrounding the definition of “waters of the United States.” Accordingly, the CWA’s expansion in Maui could mean a significantly increased risk of agency enforcement and citizen suits. Perhaps Justice Breyer’s “functional equivalent” standard will have similarly lasting implications as industries will be faced with new CWA permitting challenges.


[1] County of Maui v. Hawai’i Wildlife Fund, 2020 U.S. LEXIS 2410 (2020).

[2] County of Maui v. Hawai’i Wildlife Fund, 24 F. Supp. 3d 980, 998 (Haw. 2014).

[3] County of Maui v. Hawai’i Wildlife Fund,  886 F. 3d 737, 749 (9th Cir. 2018).

[4] Upstate Forever v. Kinder Morgan Energy Partners, L.P., 887 F. 3d 637, 651 (4th Cir. 2018).

[5] Kentucky Waterways Alliance v. Kentucky Util. Co., 905 F. 3d 925, 932-938 (6th Cir. 2018).

[6] 85 Fed. Reg. 77 at 22251, 22313.

[7] Brief for Kinder Morgan Energy Partners, L.P. and Plantation Pipe Line Company, Inc. as Amici Curiae Supporting Petitioner, at 28-29 (No. 18-260).

[8] Brief for Agricultural Business Organizations as Amici Curiae Supporting Petitioner, at 4 (No. 18-260).

[9] Id. at 21-26. 

[10] Id. at 29.


[12] Brief for Aquatic Scientists and Scientific Societies as Amici Curiae Supporting Respondents, at 5 (No. 18-260).